MOSS ADAMS CAPITAL: Apparel and foowear market monitor highlights notable deals, stock prices and results.
Details on Industry Insight.
The Australian sunglass brand Filtrate has broken into the U.S. market. We ask CEO Wade Sutton how the brand will stand out in the crowded sunglass category and about global plans.
Growing up on the beach in Australia, you want to keep your money for the important things like new boards, wetsuits and enough spare change to enjoy the weekend. I was never happy with spending over $100 on eyewear, and most of the cheaper sunglasses out there were just that - cheap! I saw an opportunity to fill this void with some quality eyewear at an accessible price, so co-founder Andy Harler (who runs the Australian operation) and I put together an action plan, and it all started there.
Luckily at that stage, I was working for Rip Curl at a time when it was developing its eyewear line, which gave me a good insight into the sunglasses field. My business partner owned a surf shop, and knew what retailers wanted, and I knew the wholesale side of things, and had a background in design, so we made a pretty good team.
We have seen some huge growth over the last 12 months. Our official launch into the U.S. market was in April 2010. Then we finalized a 5-year distribution contract for Europe with Flow Sports and most recently Latin America where we have partnered with Joel Birnbaum from Accur8 distribution, who also distributes Vans and Pro-tec. We are now in the final stages to sell direct into Canada. South Africa has also been having great success with the brand as has French Polynesia and of course, Australia.
We have been self-financed from day one. In 2010 we had an angel investor step in, and that allowed us to capitalize on the rapid growth in North America.
Our forecast for this year is approximately $2,000,000 in turnover. We will have to keep a close eye on the economy and keep our growth organic but we are on track to reaching that figure.
We are marketing to a young (14 to 25 years-old) demographic. Our target is at the intersection of action sports and youth culture. We have found a niche in the mid-tier, price market for quality eyewear. In Australia, we are mostly targeting surf lifestyle and sunglass specialty accounts. Our goal is to fill a void in the core market for premium products at an accessible price.
It was always a plan to bring the brand to America. We just wanted to wait until the time was right, and we were confident with our product and styles. We did a lot of research and went to a few trade shows to prepare ourselves, and with the reaction we received, and the economy being the way it is, we felt there was enough demand for Filtrate to enter the competitive American market.
We are very fortunate to have Lee Bird (founder of Bridgetown Capital Partners) come on board as an angel investor, and chairman of the board. Lee was the president of Nike Affiliates, and has a wealth of knowledge. He brings a lot to the company and has been a huge help in the negotiation of our global distribution contracts.
We have opened nearly 300 doors and the sell-through has been great. We are the number one turning sunglass in a number of the shops we are in, against some tough competition, so we could not be happier with our performance. There has been opportunity to open more doors but we are being selective, and want to keep our growth under control. Our products can currently be found in key retail stores including HSS, ZJ Boardinghouse, Wavelengths, K5, WRV, BC Surf and Sport, Coastal Edge, and many more.
See Page 2 for more about Filtrate's strategy